Trade War Risks Accelerate …

Trump is threatening 25% tariffs on billions of dollars more of Chinese exports to the U.S., which creates “increasing uncertainty [that] will weigh on business investment and potentially on firms’ decisions on where to locate portions of global supply chains,” according to Moody’s.

The conservative Tax Foundation says a 25% levy imposed on $150 billion worth of imports from China “is equivalent to nearly $38 billion tax increase on American firms and consumers in 2018” and “could potentially claw back many of the benefits that businesses and households expected to see” from the sweeping tax overhaul passed in December.

While it is NOT absolutely certain that the Chinese has stopped purchasing all USA debt, it would seem (to them at least) logical to reduce such purchases to send a message to the USA that it can hit the USA hard.

If China cashed out of most of its USA bonds, etc., this could be a problem that could be catastrophic.

Notice the following from a couple of weeks ago where the reduction of purchases of USA debt was alluded to:

March 23, 2018

China’s ambassador to the U.S. wouldn’t rule out the possibility of the Asian nation scaling back purchases of Treasuries in response to tariffs imposed by President Donald Trump.

“We are looking at all options,” Ambassador Cui Tiankai told Bloomberg Television, when asked whether China would consider reduced purchases of U.S. Treasuries. “That’s why we believe any unilateral and protectionist move would hurt everybody, including the United States itself. It would certainly hurt the daily life of American middle-class people, and the American companies, and the financial markets.”

China is America’s biggest foreign creditor. It held $1.17 trillion in Treasuries as of January, or about 19 percent of all foreign holdings of U.S. government securities.

The USA is walking a dangerous line on its debt that will not end well.

Let us also consider that there is a prophecy in Habakkuk, written about 2600 years ago, about debt which is preceded by the following:

2 Then the Lord answered me and said:

“Write the vision And make it plain on tablets, That he may run who reads it. (Habakkuk 2:2)

The Bible says that the ‘debt prophecy’ in Habakkuk 2 is so significant that those who read it should run—essentially that they should take steps because the results will be horrific. Donald Trump and many other American politicians have not run away from increasing U.S.A. debt—that will be to the nation’s peril.

The Bible warns about something that will happen to a heavily indebted nation. Notice what the Hebrew seer Habakkuk wrote over 2,600 years ago:

3 For the vision is yet for an appointed time; But at the end it will speak, and it will not lie. Though it tarries, wait for it; Because it will surely come, It will not tarry … 5 Indeed, because he transgresses by wine, He is a proud man … 6 “Will not all these take up a proverb against him, And a taunting riddle against him, and say, ‘Woe to him who increases What is not his—how long? And to him who loads himself with many pledges’? 7 Will not your creditors rise up suddenly? Will they not awaken who oppress you? And you will become their booty. 8 Because you have plundered many nations, All the remnant of the people shall plunder you…” (Habakkuk 2:2-3,6–8).

Notice that what is to happen is so bad, that people who read the prophecy should run, when it is time for it to be fulfilled. Since that prophecy is to be fulfilled at the appointed time of the end, it is still for the future, but perhaps not too far distant in the future. No nation has ever been in as much total debt as the U.S.A.

Interestingly, in the past, one foreign creditor, China, has raised concerns about the U.S. debt that are so serious, that its potential dumping of that debt has been called China’s “nuclear option” (Gertz B, China Debt Threat. Washington Times, March 2, 2011) against the U.S.A.—an option that involves no military intervention, but that could greatly harm the U.S.A. (Thiel B. Donald Trump and America’s Apocalypse. Nazarene Books, 2017)

The USA must know that China is looking at what to do with US debt.

However, I do NOT expect the Chinese to try to dump it all now (if they sell any at all). But the time will come when Habakkuk 2 will be fulfilled.